Page 33 - RusRPTJun19

Weak demand conditions in April were also underpinned by only a fractional increase in employment reported, with the slowest rise in workforce numbers since last October. "Some panellists noted that a slowdown in new business growth had reduced pressure on capacity," the report comments.
In the meantime, input cost inflation softened in April, while the rate of output charge inflation remained in line with that seen in March and its respective series trend. As a result, inflationary pressures eased across both manufacturing and services in the reporting month.
“Russian service providers signalled a noticeable slowdown in business activity growth in April. The moderate expansion eased following some reports of less robust domestic demand conditions. Conversely, new export sales rose at the fastest pace in the series history," Sian Jones the economist of IHS Markit commented on the report.
In March, IHS Markit expected industrial production to rise 2.0% in 2019, down from 2.9% in 2018 and largely driven by oil and gas output.
The weakness seen in April in the PMI indexes is in line with the first-quarter base sector statistics, which showed rather moderate results and had analysts hoping for a fiscal spending stimulus later in 2019 supporting the output.
"Consumption, construction output weighed in [in the first quarter]; agricultural production shows modest growth, while industry is the prime driver – mostly thanks to Oil and Gas," BCS Global Markets summarized the 1Q19 data on April 19.
"If it were not for the supportive crude oil price trend in 1Q19, Russia’s economy would have come to a standstill, not least due to the suppressed consumer demand and cuts to fiscal spending (defence procurements)," BCS GM argued, placing all hopes on infrastructure spending increasing in 2019
33 RUSSIA Country Report June 2019 www.intellinews.com